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TLTRO III and bank lending conditions

Author

Listed:
  • Barbiero, Francesca
  • Boucinha, Miguel
  • Burlon, Lorenzo

Abstract

The third series of targeted longer-term refinancing operations (TLTRO III) enabled one of the largest liquidity injections by the European Central Bank (ECB). This article provides an assessment of the effectiveness of the operations in supporting bank lending conditions. It discusses the main transmission channels of TLTRO III, including in relation to other policy measures. This article also includes a box on the importance of collateral easing measures, a box on the impact of TLTRO III on money market rates, and a box on the consequences of high participation in TLTRO III for excess liquidity levels. The article then documents, based on hard data on banks’ balance sheets and soft information from bank surveys, the extent to which TLTRO III has eased bank lending conditions, thereby helping to support access to credit for households and firms during the coronavirus (COVID-19) crisis. JEL Classification: E51, E52, E58, G01, G21

Suggested Citation

  • Barbiero, Francesca & Boucinha, Miguel & Burlon, Lorenzo, 2021. "TLTRO III and bank lending conditions," Economic Bulletin Articles, European Central Bank, vol. 6.
    • Handle: RePEc:ecb:ecbart:2021:0006:2
    Note: 2609469
    as

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    File URL: https://www.ecb.europa.eu//pub/economic-bulletin/articles/2021/html/ecb.ebart202106_02~35bf40777b.en.html
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    Citations

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    Cited by:

    1. Martín Fuentes, Natalia & Di Vito, Luca & Leite, João Matos, 2023. "Understanding the profitability gap between euro area and US global systemically important banks," Occasional Paper Series 327, European Central Bank.
    2. Altavilla, Carlo & Barbiero, Francesca & Boucinha, Miguel & Burlon, Lorenzo, 2023. "The Great Lockdown: Pandemic response policies and bank lending conditions," European Economic Review, Elsevier, vol. 156(C).
    3. Barbiero, Francesca & Burlon, Lorenzo & Dimou, Maria & Toczynski, Jan, 2022. "Targeted monetary policy, dual rates and bank risk taking," Working Paper Series 2682, European Central Bank.

    More about this item

    Keywords

    bank lending; COVID-19 crisis; Monetary policy; TLTRO;
    All these keywords.

    JEL classification:

    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G01 - Financial Economics - - General - - - Financial Crises
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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